Question 1

What does daily reset mean for a leveraged ETF?

Accepted Answer

Daily reset means the fund aims for its multiple (2x, 3x, or inverse) of the benchmark's return each single day. At the end of each day it effectively rebases, so the next day's multiple is applied to the fund's new value rather than to your original investment.

Question 2

Why does +10% then -10% leave a 3x ETF down 9%?

Accepted Answer

With 3x leverage, +10% becomes +30% (100 → 130) and -10% becomes -30% (130 → 91). The benchmark goes 100 → 110 → 99, down about 1%, but the 3x fund goes 100 → 130 → 91, down about 9%. Each day compounds from the new value, so the symmetric-looking moves are not symmetric for the leveraged fund.

Question 3

Is a 3x ETF the same as 3x the long-term return?

Accepted Answer

No. A 3x ETF targets 3x the daily return, not 3x the cumulative or long-term return. Over multiple days the two can differ substantially in either direction depending on the path of returns.

Question 4

Do leveraged ETFs reset more often than daily?

Accepted Answer

Most listed leveraged and inverse ETFs target a daily objective and rebalance once per day. Some products target other periods, but daily is by far the most common. This calculator models the standard daily-reset behavior.

Question 5

Can I model more than two days?

Accepted Answer

Yes. Use the 'Add a day' button to enter as many daily returns as you like and watch the benchmark and leveraged values evolve day by day, along with the running totals.

Leveraged ETF Daily Reset Calculator

Daily Reset Simulator

Daily reset, step by step

Frequently asked questions